Biosimilars Competition Act Introduced to Scuttle “Pay-for-Delay” Deals

Intended to directly address originator pharmaceutical manufacturers’ attempts to slow competition, Congressman John Sarbanes (D-MD) introduced a new proposal on July 23. Called the Biosimilars Competition Act of 2018 (H.R. 6478), the bill hopes to speed biosimilars to market.

Biosimilars Competition Act
Rep. John Sarbanes (D-MD)

On his website, Representative Sarbanes said, “We must take every step possible to prevent Big Pharma from continuing to raise drug prices on hardworking American families. This bill will help lower prescription drug costs by bringing more affordable biosimilar drugs to the market.”

The Biosimilars Competition Act would compel manufacturers of biologics and biosimilars to publicly disclose any arrangements that delay drug access. Generally, these pay-for-delay arrangements offer some type of exclusive access (at a later date) for the biosimilar or generic maker, in exchange for licensing fees or upfront payments to the manufacturer of the originator product.

In the biosimilar space, these agreements have been made (e.g., Mylan/Biocon with Roche on trastuzumab or Amgen with AbbVie on adalimumab) to end protracted patent litigation. Their result are technically “authorized biosimilars.” This is not unlike many deals made by generic manufacturers with branded drug makers. Essentially, both forms are anticompetitive. However, if the biosimilar deals were not made, there are no guarantees that the biosimilar would be launched earlier. The drug maker may have simply decided to wait out the patent fight, also resulting in delayed access (despite the expiration of the regulatory 12-year exclusivity period).

A slew of payer and provider organizations and patient advocacy groups quickly co-signed a letter endorsing the proposal. These included the Academy for Managed Care Pharmacy, America’s Health Insurance Plans, Families USA, Blue Cross Blue Shield Association, among others.

The Biosimilars Competition Act would make these agreements subject to review by the Department of Justice and the Federal Trade Commission, with regard to their anticompetitive intent. Cosponsored by Republican Representative Bill Johnson (R-OH), the bill has been referred to the House Committee on Energy and Commerce.

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